5 mining stocks under $20 to closely watch: FIL, CS, ERO, HBM & LUN

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 5 mining stocks under $20 to closely watch: FIL, CS, ERO, HBM & LUN
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Highlights

  • Filo Mining stock galloped by about 97 per cent in 52 weeks
  • Capstone stock jumped by nearly 33 per cent in one month
  • The S&P/TSX Global Base Metals Index gained almost nine per cent in 2022

Under C$ 20, mining stocks like Filo Mining (TSX: FIL), Capstone (TSX: CS), Ero Copper (TSX: ERO) etc. helped the TSX Composite Index jump by 0.05 per cent to the positive territory on Tuesday, August 23, after suffering from triple-digit losses for consecutive two sessions. This rally in metal stocks came as commodity prices rebounded slightly this day, with gold prices at US$ 1,761.2 per troy ounce, up by 0.73 per cent, and silver prices at US$ 19.02 per ounce, up by 0.78 per cent. Copper prices also jumped by 0.63 per cent to US$ 3.67 per pound at market close.

The market environment may remain unstable as investors await the US central bank meeting this Friday, August 26. However, precious metal and base metal stocks could be a safer bet at the present moment as they are likely to increase if underlying commodity sees price surge in the future.

Hence, here are five TSX mining stocks selected by Kalkine Media®, priced under C$ 20 that one can explore in the current market.

1.     Filo Mining Corp (TSX: FIL)

Filo Mining is a mid-cap firm focused on exploring and developing mineral resource properties in Chile and Argentina. The metal miner improved its cash position by posting cash and cash equivalents (CCE) of C$ 102.63 million at the end of Q2 2022, notably high from C$ 19.41 million at the end of the fourth quarter last year. Filo reported C$ 8.93 million worth of mineral properties on June 30 this year, up from C$ 8.06 million on December 31, 2021.

The miner also saw its working capital increase to C$ 89.83 million in the quarter ended on June 30, 2022, compared to C$ 13.05 million on December 31 last year.

Filo Mining stock galloped by about 97 per cent in 52 weeks. According to Refinitiv findings, FIL stock recorded a Relative Strength Index (RSI) value of 52.43 on August 23, which signals a moderate momentum in the stock market.

2.     Capstone Copper Corp (TSX: CS)

Capstone Copper posted a quarterly copper production of 45,200 tonnes at C1 cash costs of US$ 2.78 per pound of copper produced in the second quarter of fiscal 2022. Meanwhile, the company sold 45,500 tonnes of copper in the latest quarter at a realized copper price of US$ 3.66 per pound.

Capstone posted US$ 356.6 million in revenues in the second quarter of this fiscal year, up from US$ 209.4 million posted a year ago. The resource miner also reported a net profit of US$ 92 million in the latest quarter, indicating a significant increase from US$ 49.4 million a year ago.

Capstone stock jumped by nearly 33 per cent in one month. As per Refinitiv findings, the CS stock held an RSI value of 56.01 on August 23, representing a medium trend.

5 TSX mining stocks under $20 to closely watch: FIL, CS, ERO, HBM, LUN©Kalkine Media®; ©Garis Studio via Canva.com

3.     Ero Copper Corp (TSX: ERO)

Ero Copper produced 12,734 tonnes of copper at C1 cash costs of US$ 1.24 per payable copper pound in Q2 2022. The small-cap metal company also reported gold production of 11,122 ounces at C1 cash costs of US$ 643 per gold ounce in the latest quarter, with an All-in sustaining cost (AISC) of US$ 1,169 per gold ounce.

The company’s revenue was US$ 114.9 million in Q2 2022, up from US$ 108.9 million in Q2 2021. However, the base metal miner posted a net income of US$ 24.1 million in Q2 2022, low from US$ 52.5 million a year ago.

Ero Copper stock swelled by roughly 28 per cent quarter-to-date (QTD). According to Refinitiv data, the ERO scrip saw an RSI value of 58.65 (above the oversold level of 30 but below the overbought level of 70) on August 23.

4. Hudbay Minerals Inc (TSX: HBM)

Hudbay Minerals said its revenue reached US$ 415.45 million in the second quarter of 2022, higher than US$ 404.24 million in Q2 2021.

The C$ 1.53 billion market cap company incurred increased mining operating costs of US$ 238.63 million in the latest quarter compared to US$ 222.75 million in Q2 2021. However, lower depreciation and amortization (US$ 87.3 million in Q2 2022 compared to US$ 99.3 million in Q2 2021) led its gross profit to increase to US$ 89.51 million in the latest quarter, higher than US$ 82.18 million in the same period last year.

Hudbay considerably improved its profitability as its net profit amounted to US$ 32.14 million in the second quarter this year relative to a loss of 3.39 million in Q2 2021. As for its stock performance, Hudbay stock climbed nearly 34 per cent in one month. As per Refinitiv information, the HBM stock had an RSI value of 60.17 on August 23, pointing to a medium-to-high momentum.

5.     Lundin Mining Corporation (TSX: LUN)

Lundin Mining reported a revenue of US$ 590.2 million in Q2 2022, higher than US$ 872.3 million in the same quarter of the previous year.

The mid-cap metal miner also saw its profitability reduce as it incurred a net loss of US$ 48.6 million in Q2 2022 compared to a net profit of US$ 268.4 million a year ago. However, Lundin improved its cash position as its cash, and cash equivalents (CCE) jumped to US$ 498.2 million in Q2 2022, relatively up from US$ 294.9 million in Q2 2021.

As per the latest balance sheet, Lundin has net cash of US$ 469.9 million in the second quarter of this fiscal year compared to US$ 153.4 million in the same period last year.

Lundin Mining stock slipped by over 25 per cent year-to-date (YTD). As per Refinitiv data, the LUN stock seems to be on a moderate trend with an RSI value of 51.17 on August 23, supported by about 5.75 million shares exchanging hands.

Bottom line

The S&P/TSX Global Base Metals Index has gained almost nine per cent this year. The S&P/TSX Capped Material Index also rose by approximately five per cent month-to-date (MTD). In addition, Hudbay will distribute a semi-annual dividend of C$ 0.01 on September 23, while Lundin will dole out a quarterly dividend of C$ 0.09 on September 14.

Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.

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